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Russia/Ukraine: Legislators Question Value Of U.S. Aid

Washington, 27 March 1998 (RFE/RL) -- A U.S. plan to increase economic assistance to the newly independent states next year has stirred a debate among legislators on the usefulness of pouring scarce U.S. dollars into Russia and Ukraine.

The powerful chairman of the U.S. House of Representatives International Relations Committee, Benjamin Gilman (R-New York), questioned Thursday whether increasing or cutting aid is an effective way to get Russia or Ukraine to change policies that go against U.S. national interests.

He noted at a committee hearing on the 1999 assistance budget that the State Department wants to increase aid to Russia in the next fiscal year starting this October -- as Gilman put it "despite the many things Russia does with regard to Iran, Iraq, Cuba... that go against the things that America is trying to support or achieve around the world as a responsible member of the international community."

Another panel member, Congressman Dana Rohrabacher (R-California), had stronger words on the issue, saying reports of Russian and Ukrainian involvement in sales of nuclear and conventional weapons to America's enemies "are totally unacceptable."

He warned that if such actions continue, there could be moves in the U.S. Congress to cut assistance to Russia.

But on the minority Democrat side, Congressman Lee Hamilton (D-Indiana) urged just the opposite. He pointed out that the U.S.-Russian relationship is of primary importance but the U.S. aid program, in his words is "heavily skewered away from Russia."

Hamilton said "Russia is the key country for the U.S....but on a per capita basis the U.S. gives $25 to Armenia, sixteen and a half dollars to Georgia, and $4.34 to Ukraine. And we are giving 86 cents per capita to Russia.... that is not the right priority."

The main government witness at the hearing, presidential adviser and the State Department's top coordinator on aid for the newly independent states, Richard Morningstar, said the U.S. needs to do all it can to help Russians make the transition to a market democracy.

"That's why we keep asking (Congress) for increased aid for Russia," he said, adding "not to assist the government of Russia...but to create the climate within the country at the grassroots level."

U.S. assistance programs for Russia are currently budgeted at $130 million. Morningstar said the U.S. wants congressional approval to increase that to $225 million in the 1999 fiscal year.

Ukraine is currently getting $225 million and the same amount is budgeted for 1999. But Congress has mandated a 50 percent cut in aid to Ukraine if that country fails to take steps by the end of next month to curb widespread official corruption.

The legislation requires Secretary of State Madeleine Albright to certify to the Congress by April 30 that progress has been made. She visited Kyiv briefly earlier this month to assess the situation. But Morningstar said Albright has not yet made the determination.

He said U.S. officials are working constantly with the Ukrainians to resolve the complaints of private American investors that prompted Congress to pass the punitive provision.

Morningstar said he himself spends half his time on Ukraine. He plans to travel to Kyiv in April in a last attempt before the April 30 deadline, Morningstar said the U.S. "hopes very much there will be enough resolution of the business disputes" to avoid triggering the provision.

Gilman in his opening remarks praised Ukraine for a " pro-western approach" and cooperation with the U.S. on such matters as refraining at America's request from selling turbines to Iran for its Russian-sponsored nuclear reactor project. He said Congress wants to help American investors in Ukraine without undermining the country's pro-Western attitude.

He said U.S. assistance programs to Russia, Ukraine and other countries in the region should serve U.S. national interests, as well as provide aid for humanitarian purposes and to encourage the democratic development that will help stabilize the region.

Morningstar said the State Department is asking Congress to approve a 20 percent increase in assistance programs for the region, jumping from a current total of $770 million to an aid budget of $925 million in the 1999 fiscal year.

The numbers will be considered separately in the U.S. Senate and House of Representatives and eventually crystallize in a legislative proposal for the 1999 budget which is expected to be approved by September.